1. Field of the Invention
This invention relates to facilitating payments by a third party. More specifically, it relates to capturing and utilizing initial transactional data to streamline subsequent payments made using a payment card.
2. Brief Description of the Related Art
Third party administrators, insurance companies, and large self-funded corporations (herein “Payers”) adjudicate claims, compare them to a benefit plan and make the decision to write checks in payment for the claims. Currently, Payers are required to print checks and explanation of benefit (EOB) forms for delivery to the health care providers. The EOB lists the amount the health care provider billed the Payer's company and the amount the Payer's company paid on the claim. It may also list the contractual discount amount and the patient responsibility. If the claim is denied, the EOB will explain the reason for denial.
In an effort to streamline this process, Applicant developed a process described in U.S. Pat. No. 7,792,686, the specification of which is incorporated herein by reference. The '686 patent discloses a method to deploy a single-use stored value card to pay medical service claims. Since there is a one-to-one relationship between the stored value card and the specific claim, reconciling the payment is made substantially more efficient. However, the method still requires the medical service provider (typically the bookkeeper) to receive the stored value card information including the expiration date, account number, payment amount, verification codes and the like and repeatedly input the information as a card-not-present transaction through the credit card terminal. The transaction must then be authorized, cleared and settled before the service provider receives its funds.
The present invention streamlines this process going forward by capturing certain data values in the initial process and then utilizes them to implement a direct push-through payment to the service provider's merchant account. The service provider does not need to perform the administrative tasks of running a card payment transmitted by the payer. Rather, the service provider is simply “paid” receiving an authorization confirmation of the completed financial transaction and an explanation of benefits detailing how the funds were applied.
An advantage to the present invention is that less card payment information is transmitted between payer and service provider thereby lowering security risk and potential fraud.
Another advantage of the present invention is that direct payment reduces the administrative burden put on the service provider to process payments.
Yet another advantage of the present invention is that the service provider is paid faster.
Yet another advantage of the present invention is a potentially lower interchange rate because the eliminated risk of processing a “card-not-present” in subsequent transactions.
Yet another advantage of the present invention is that no sign-up or enrollment is required by the service provider. The necessary data is automatically captured and utilized for subsequent direct payments.
However, in view of the art considered as a whole at the time the present invention was made, it was not obvious to those of ordinary skill in the field of this invention how the shortcomings of the prior art could be overcome.